The Australian share market looks set to slip into the new month after Wall Street’s major indexes ended the last day of May mixed and commodities weakened. Over the month the Dow and S&P 500 ended at a record while the Nasdaq surged more than 3 per cent – defying the ‘Sell in May and go away’ mantra. Across commodity markets gold and copper prices have continued to slide while iron ore has shed another 4 per cent. In the week ahead attention will turn to the Reserve Bank of Australia's (RBA) June interest rate decision tomorrow, Wednesdays’ local growth figures, Thursday’s European Central Bank (ECB) meeting and Friday’s US jobs report.
Global markets
Wall Street closed mixed on Friday: The Dow Jones Industrial Average added 18 points to close at 16,717, the S&P 500 added 4 points to close at 1,924 and the Nasdaq lost 5 points to close at 4,243.
Eurozone shares gained 1.5 per cent in May but major markets finished mixed on Friday: London's FTSE 100 lost 27 points, France's CAC 40 lost 11 points and Germany's DAX added 4 points.
Asian markets mainly rose in May but also ended mixed on Friday: Japan’s Nikkei lost 49 points, Hong Kong’s Hang Seng added 72 points, China’s Shanghai Composite lost 1 point.
The Australian share market ended Friday 0.5 per cent lower but the month of May slightly higher for the first time in five years. The S&P/ASX 200 index lost 27 points on Friday to end at 5,492.5 – slightly down over the week but 3.5 points higher over the month of May and 2.3 per cent stronger over the year-to-date. On the futures market the SPI is pointing 8 points lower.
Currencies
After gaining almost $US0.01 over last week the Australian dollar at 7:20am was buying $US0.9309, 55.54 Pence Sterling, 94.81 Yen and 68.29 Euro cents.
Economic news due out today
Australian Bureau of Statistics: Business indicators for March quarter and building approvals
TD Securities-Melbourne Institute: Inflation gauge for May
Australian Industry Group: Performance of manufacturing (PMI) index for May
Reserve Bank of Australia: Index of commodity prices for May
RP Data-Rismark: Home Value Index for May
Best & worst sectors in May
Oil Search Limited
(ASX:OSH) helped boost the energy sector to the top performer over the month of May. The sector rose 3 per cent over the month also aided by a stronger oil prices and a significant gas agreement between Russia and China. Oil Search jumped more than 6 per cent over May after welcoming the first shipment of liquefied natural gas from the $US19 billion PNG LNG project in Papua New Guinea. Energy majors Origin Energy Limited
(ASX:ORG), Santos Limited
(ASX:STO) and Woodside Petroleum Limited
(ASX:WPL) also gained ground over the month. Shares in Oil Search rose 0.21 per cent on Friday to end the month of May at $9.43.
Fortescue Metals Group Limited
(ASX:FMG) dragged on the mining sector in May as the price of the steel making commodity tumbled below $US100 per tonne. The materials sector lost 3 per cent last month while pure play iron ore producer Fortescue plunged almost 10 per cent.
Major miners BHP Billiton Limited (ASX:BHP) and Rio Tinto Limited (ASX:RIO) also fell over the month. Australia’s biggest gold producer Newcrest Mining Limited (ASX:NCM) sank more than 5 per cent with the price of spot gold shedding 3.3 per cent in May. Shares in Fortescue Metals Group fell 2.86 per cent on Friday to end the month of May at $4.41.
Ex-dividends today
Aristocrat Leisure Limited
(ASX:ALL) paying an 8 cent unfranked dividend
Ex-dividends tomorrow
Alliance Aviation Limited
(ASX:AQZ) paying a 3.6 cent fully franked dividend
CSR Limited
(ASX:CSR) paying a 5 cent unfranked dividend
Commodities
After dropping almost $US37 over last week the price of gold has fallen $10 to $US1,246 an ounce for the August contract on Comex.
Silver has retreated $0.33 to $18.68 for July.
Copper has slipped $0.02 to $3.12 a pound.
Oil has lost $0.87 to $US102.71 a barrel for July light crude in New York.
